Waterstone Financial (WSBF) AI Stock Analysis

• Market Cap: $267.06M
• Dividend Yield: 4.29%
• Average Volume (3M): 47.05K
• Price to Earnings (P/E): 13.8
• Beta (1Y): 0.76
• Revenue Growth: 5.89%
• EPS Growth: 96.63%
• Country: US
• Employees: 600
• Sector: Financial
• Sector Strength: 82
• Industry: Banks - Regional
• EPS (TTM): 0.17
• Shares Outstanding: 19,075,518
• 10 Day Avg. Volume: 50,683
• 30 Day Avg. Volume: 47,045
• PEG Ratio: -0.28
• Price to Book (P/B): 1.02
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 1.83
• Enterprise Value/Market Cap: 2.72
• Enterprise Value/Revenue: 1.07
• Enterprise Value/Gross Profit: 4.45
• Enterprise Value/Ebitda: 9.18
• 1Y Price Target: $14.50
• Price Target Upside: 4.47% Upside
• Rating Consensus: Hold
• Number of Analyst Covering: 1

• Rating: 69 Neutral
• Price Target: $14.50 ▲(4.47%Upside)

Waterstone Financial's overall stock score of 69 reflects its strong cash flow and positive technical indicators. The stock's moderate valuation and attractive dividend yield add further appeal. However, financial stability is somewhat constrained by high leverage and modest profitability, highlighting areas for improvement to support sustainable growth.

Waterstone Financial Business Overview & Revenue Model

Company Description

Waterstone Financial, Inc. operates as a bank holding company for WaterStone Bank SSB that provides various financial services to customers in southeastern Wisconsin, the United States. It operates in two segments, Community Banking and Mortgage Banking. The Community Banking segment offers consumer and business banking products and services, such as deposit and transactional solutions, including checking accounts, online banking and bill pay services, money transfer services, as well as credit, debit, and pre-paid cards; investable funds solutions comprising savings, money market deposits, individual retirement accounts, and certificates of deposit; residential mortgages, home equity loans and lines of credit, personal and installment loans, real estate financing, business loans, and business lines of credit; and fixed and variable annuities, insurance products, and trust and investment management accounts. It also provides transaction deposits, interest bearing transaction accounts, demand deposits, non-interest-bearing demand accounts, and time deposits; secured and unsecured lines; commercial real estate construction loans; term loans for working capital, inventory, and general corporate use; and personal term loans and investment services. The Mortgage Banking segment offers residential mortgage loans for the purpose of sale in the secondary market. The company also invests in a portfolio of securities include mortgage-backed securities, government-sponsored and private-label enterprise bonds, collateralized mortgage and municipal obligations, and other debt securities. It operates 14 full-service banking offices, 1 drive-through office, and 14 automated teller machines located in Milwaukee, Washington, and Waukesha Counties, Wisconsin. The company was formerly known as Wauwatosa Holdings, Inc. and changed its name to Waterstone Financial, Inc. in August 2008. Waterstone Financial, Inc. was founded in 1921 and is based in Wauwatosa, Wisconsin.

How the Company Makes Money

Waterstone Financial generates revenue through its two main segments: Community Banking and Mortgage Banking. In the Community Banking segment, the company earns money from interest income on loans and leases, as well as fees from deposit accounts. It offers various types of loans including commercial real estate, residential real estate, and consumer loans. The Mortgage Banking segment contributes to revenue through the origination and sale of residential mortgage loans, earning fees from mortgage originations and sales to investors. This segment can be sensitive to interest rate fluctuations and housing market conditions. Waterstone Financial also benefits from partnerships with other financial institutions for loan sales and secondary market activities.

Waterstone Financial Financial Statement Overview

Summary

Waterstone Financial exhibits mixed financial health. The income statement shows improving revenue but declining margins in the longer term, while the balance sheet demonstrates a strong position with no debt. However, cash flow variability raises caution about liquidity and operational efficiency. Overall, the company holds a stable position but may face challenges in sustaining growth and profitability without improving cash conversion efficiency.

Income Statement

Waterstone Financial's recent revenue growth rate of 14.05% from 2023 to 2024 shows positive momentum, but it's a significant decline from prior years. The company's gross profit margin and net profit margin for 2024 are strong at 100% and 16.51%, respectively, indicating efficient cost management. However, the EBIT margin has shown volatility over the years, and the absence of EBITDA data limits a comprehensive analysis of operating efficiency.

Balance Sheet

The company's balance sheet is stable with a debt-to-equity ratio of 0 in 2024, showing no financial leverage risk. The equity ratio of 15.35% highlights a conservative capital structure, though lower than desired for high growth potential. Return on Equity (ROE) for 2024 is relatively modest at 5.51%, reflecting limited returns on shareholder investments despite low debt levels.

Cash Flow

The cash flow performance of Waterstone Financial shows variability, with free cash flow turning positive in 2024 after a negative previous year, indicating improved cash generation. The operating cash flow to net income ratio is low, highlighting potential challenges in converting income into cash. The free cash flow to net income ratio for 2024 is also low, suggesting constraints in cash available for growth and investment.

Breakdown	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	113.17M	99.21M	157.76M	254.10M	292.87M
Gross Profit	113.17M	99.21M	157.76M	254.10M	292.87M
EBITDA	0.00	0.00	28.51M	98.16M	113.72M
Net Income	18.69M	9.38M	19.49M	70.79M	81.14M
Balance Sheet
Total Assets	2.21B	2.21B	2.03B	2.22B	2.18B
Cash, Cash Equivalents and Short-Term Investments	243.73M	36.42M	232.55M	541.76M	235.54M
Total Debt	443.55M	464.00M	385.70M	475.00M	499.00M
Total Liabilities	1.87B	1.87B	1.66B	1.78B	1.77B
Stockholders Equity	339.13M	344.06M	370.49M	432.77M	413.12M
Cash Flow
Free Cash Flow	46.96M	-28.28M	205.96M	153.68M	-94.81M
Operating Cash Flow	48.06M	-27.58M	206.66M	154.45M	-93.58M
Investing Cash Flow	-23.96M	-159.22M	-335.74M	147.62M	37.19M
Financing Cash Flow	-20.76M	176.58M	-201.00M	-20.12M	76.86M

Waterstone Financial Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 13.88
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For WSBF, the sentiment is Positive. The current price of 13.88 is above the 20-day moving average (MA) of 13.57, above the 50-day MA of 12.92, and above the 200-day MA of 13.47, indicating a bullish trend. The MACD of 0.27 indicates Negative momentum. The RSI at 63.73 is Neutral, neither overbought nor oversold. The STOCH value of 46.95 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for WSBF.

Waterstone Financial Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
PLBC	81 Outperform	$316.97M	9.25	16.93%	2.53%	10.64%	3.48%
BWFG	77 Outperform	$299.19M	24.18	4.48%	2.11%	-0.04%	-58.92%
LNKB	77 Outperform	$276.28M	7.66	12.74%	4.06%	77.09%	―
TSBK	76 Outperform	$252.76M	9.88	10.54%	3.25%	12.28%	5.73%
FDBC	73 Outperform	$277.76M	12.81	10.77%	3.32%	18.46%	32.78%
WSBF	69 Neutral	$267.06M	13.82	5.50%	4.29%	5.89%	96.63%
Sector *	67 Neutral	$16.89B	11.80	9.79%	3.77%	12.07%	-8.35%

Waterstone Financial Corporate Events

Waterstone Financial Announces Director Michael Hansen’s Retirement

On April 17, 2025, Waterstone Financial, Inc. announced the retirement of Michael Hansen as a Director of the Company and its subsidiary WaterStone Bank SSB. Hansen, who has been with the company since 2003, will continue in his roles on various committees until a successor is elected. His retirement is part of his broader retirement and estate planning objectives. Patrick Lawton, Chairman of the Company, expressed gratitude for Hansen’s 22 years of service and leadership, particularly in his role as chair of the Audit Committee.